Organizational culture is one of the most overlooked aspects within business. It can be a value creator or destroyer to any organization. The purpose of this post is to identify what is organizational culture, how it is created, and the impact it can have on organizational value. Let’s get started.
Organizational Culture: Dr. Edgar Schein out of MIT defined organizational culture as the accepted and shared norms, values, and beliefs of individuals within an organization. Through these shared experiences the genetic makeup of an organization is created. Such interactions can be created by owners, leadership, employees, and other stakeholders that may influence such factors.
Take for example, Zappos, Tony Hsieh, CEO & Founder, noted that “as we grow as a company, it has become more and more important to explicitly define our core values from which we develop our culture, our brand, and our business strategies,”. At Zappos, the core values are engrained into the everyday way of doing things. This is created by setting the standard core values. For Zappos, those core values:
- Deliver WOW through service.
- Embrace and drive change.
- Create fun and a little weirdness.
- Be adventurous, creative, and open-minded.
- Pursue growth and learning.
- Build open and honest relationships with communication.
- Build a positive team and family spirit.
- Do more with less.
- Be passionate and determined.
- Be humble.
Think about these core values for a moment. The accepted norm is the standard at Zappos. It is how the CEO and his team work toward providing exceptional service. It is not a generic motto in which they strive to be, it is how they are as an organization, team, and family. The culture impacts it’s people, which then influences customers and vice-versa. Take for example, a Zappos customer called to return a pair of boots that were out of the return date policy. No problem. The Zappos rep gladly processed the return, and asked for the reason for the return. The customer replied that she had purchased the boots for her husband that had just passed away. The rep gave her condolences from everyone at Zappos, and processed her return. Right after the called ended the rep placed an order for flowers and sent them to the customer. Think about that. Let that sink in. What sadness, yet beauty and respect is illustrated within that situation. Can you see the culture being carried out without direction, just done?
Organizational culture influences essential and inessential activities that happen within organizations daily at all levels. Understanding these unique actions within organizations allows management the core values that are essential to the brand, operations, and sustainability of a firm. Can you identify your core values that shape your organizational culture? Can your employees? What about your customers? Are they the same? Are those core values used daily?
Understanding where there are differences and similarities of organizational culture provide management with the essential information that can be used to shape day to day and strategic initiatives.
How Culture is Created: Zappos illustrates that culture is created by founder(s), leadership, and employees. This is done through the establishment of accepted values and norms that tie directly to the mission, objectives, and way of doing things within an organization. This can be created through verbal and nonverbal approaches, seen through organizational structure and design, policies and procedures, trainings, and performance. Dr. Edgar Schein, proposed a three-level approach to understanding culture: observation of organizational artifacts, values, and organizational assumptions.
Organizational artifacts make up several different aspects within organizations: organizational layout, color, smells, designs, dress code, interaction, communication, procedures, projects, attitudes and accepted behaviors. The experiences shared between members of the organizations can be linked to the actual organizational artifacts. Again, the physical attributes of Zappos is even exhibited through the office layouts, conference rooms, libraries, and decor. Dr. Schein stated “we can see and feel that one company is much more formal and bureaucratic than another, but that does not tell us anything about why this is so or what meaning it has to the members,” . This is why identifying and understanding the organizational values that have been shaped by organizational culture is paramount.You can see, feel, and experience the core values in every aspect at Zappos. That being said, what are your thoughts on your organizational culture? Have you formally measured it? Have you created systems, artifacts, and structure that heightens your organizational culture to elevate your brand?
For more information about conducting organizational culture audits and shaping strategy to fit the DNA of your firm certainly feel free to reach out to me. Organizational culture is one of my favorite aspects of business and crafting strategy.
Have the best day ever!
Copyright Viral Solutions llc © 2014. All Rights Reserved
by Katie Doseck, Ph.D.
Chief Visionary and Strategic Ace Up Your Sleeve | Viral Solutions LLC
Edwards, J. (2012). Check out the insane lengths Zappos customer service reps will go to. Business Insider. Retrieved: http://www.businessinsider.com/zappos-customer-service-crm-2012-1.
N.A. (2014). Zappos Family Core Values. Zappos. Retrieved:http://about.zappos.com/our-unique-culture/zappos-core-values.